American Clean Energy and Security Act of 2009: Title II: Energy Efficiency

On June 26, 2009 the House of Representatives passed the American Clean Energy and Security Act (ACES) of 2009, a combined energy and climate bill representing our first real chance for a national carbon reduction plan in the United States. The bill combines standards and incentives to promote clean energy and energy efficiency technologies with a firm cap on greenhouse gas emissions. The Alliance will continue to work to obtain Senate passage of strong climate legislation.

• Title I: Clean Energy
• Title II: Energy Efficiency
• Title III: Global Warming Pollution Reduction Program
• Title IV: Transitioning to a Clean Energy Economy
• Title V: Agricultural and Forestry Related Offsets

Title II: Energy Efficiency

Subtitle A: Building Energy Efficiency Programs

Sec. 201: Greater Energy Efficiency in Building Codes

This provision establishes national energy efficiency building codes for homes and commercial buildings, with independent code-setting organizations developing the codes and state and local governments adopting and enforcing them, and with DOE assistance and backstop. It sets targets for the codes of 30% savings by one year after enactment, 50% savings by the end of 2014 for residential buildings and 2015 for commercial buildings, and 5% additional savings every three years thereafter through 2029 and 2030 respectively, compared to a baseline of the 2006 International Energy Conservation Code for homes and American Society of Heating, Refrigerating and Air-Conditioning Engineers Standard 90.1-2004 for commercial buildings. DOE can raise or lower the targets to achieve the maximum level of energy efficiency that is technically feasible and life-cycle cost effective. If a code-setting organization such as the International Code Council or ASHRAE develops a code that meets the target by the deadline, DOE would adopt it; otherwise DOE is to set the code. DOE is to provide technical and financial assistance to the code-setting organizations.

States are required within one year of a revision of a national code to adopt the national code, update their building code to achieve at least as much energy savings, or show that local governments in the state have done so. In any jurisdiction where neither the state nor a local government has adopted such a code within a year, the national code is made the applicable energy efficiency building code.

States or local governments are to implement and enforce the energy codes. States are to demonstrate within two years after adoption of a code that at least 90% of new and renovated building space in the state in the preceding year meets the code requirements, including documentation of the rate of compliance. For seven years after enactment states can document instead that they are making progress to better compliance, and that at least 50% of covered building space meets the code requirements.

DOE is to use 0.5% of the allowances under this bill to provide grants to states and local governments that meet the requirements of this section for development, adoption, implementation, and enforcement of energy efficiency building codes. The allocation of the grants is 1/5 equal for each state and territory, 2/5 based on energy use in buildings in the state, and 2/5 based on building activity in the state. States that do not meet the requirements cannot receive this funding, any State Energy Program funds beyond an allocation based on $125 million per year, or a percentage of all funding under this bill (primarily the SEED grants) rising to 100% in the fourth year of noncompliance.

If the state and local governments fail to enforce the building codes, DOE is to enforce them, based on a rule issued within two years of enactment. DOE may use inspection fees to cover costs. DOE and the federal courts are to assess civil penalties for violations against the builder or seller under the Energy Policy and Conservation Act. Occupancy of buildings that do not meet the code is prohibited.

Sec. 202: Building Retrofit Program

This section would direct EPA, in consultation with DOE, to establish standards for a national energy and environmental building retrofit policy for the commercial and residential sectors and to develop the Retrofit for Energy and Environmental Performance (REEP) program to implement these policies. This section would specify the amounts and forms of support that can be provided under this program and require that REEP funding not exceed 50 percent of the total cost of retrofit in each building. However, it would permit recipients of federal disaster relief funds to count those funds toward their 50 percent cost-share, as long as the REEP-provided funds are put toward improving only those buildings that are being reconstructed with the disaster-relief funds.

It would direct EPA and DOE to make appropriate use of existing programs such as EPA Energy Star for Buildings in creating and operating REEP. It would direct EPA and DOE to consult with the U.S. Department of Housing and Urban Development to ensure that any retrofits performed with REEP funds to public and assisted housing be cost-effective and be coordinated with other repair needs to the extent possible.

The EPA would fund the REEP program by providing emission allowances to each state’s SEED Account for the purposes of the program. In the absence of a state REEP program, the EPA would provide emission allowances to a local government entity. States may use State Energy Program funds that are not designated for another purpose to provide additional funds to the REEP program.

Sec. 203: Energy Efficient Manufactured Homes

This section establishes the Manufactured Home Replacement Program, which directs the DOE to provide rebates to low-income families living in pre-1976 manufactured homes to be used for purchasing Energy Star-rated manufactured homes. Each rebate is not to exceed $7,500 per manufactured home and funds are to be distributed based on each state’s share of manufactured homes that are used as primary residences and constructed prior to 1976. The provision also requires that the old residences be destroyed. The program is to be funded by emission allowances from each state’s SEED Account.

Sec. 204: Building Energy Performance Labeling Program

This section directs the EPA to create a model building energy performance labeling program for new construction. EPA is to conduct demonstration projects for different building types to assess the sufficiency of the current Commercial Buildings Energy Consumption Survey and other data, inform the development of measurement protocols for other building types and identify any areas of needed data improvement. EPA and DOE are to coordinate these demonstration projects with those undertaken for the Zero-Net-Energy Commercial Buildings Initiative adopted in the Energy Independence and Security Act of 2007 (EISA). EPA, in consultation with DOE, is to work with the State Energy Offices (or other state entities) on implementation of the labeling program.

The section directs the EPA to propose, within one year, a model building energy label that may be tailored for both residential and commercial buildings, and that provides a format to display achieved performance and designed performance data along with other appropriate elements identified during the development of the measurement protocols. The EPA is directed to work with all State Energy Offices to encourage the adoption of the model building energy label by counties and local governments. States that adopt the assessment and labeling requirements under this program and have an implementation plan within 6 months of establishment of the program become eligible for funding for program implementation. The program is to be funded by emission allowances from each state’s SEED Account.

To the extent practicable, DOE and EPA are to use the labeling program established in this section to evaluate energy performance in their facilities. This section also directs DOE and EPA to establish a business and consumer education program to increase awareness about building energy efficiency and the labeling program. In this effort DOE and EPA are to consult with nonprofit and industry stakeholders with specialized expertise, and to act in conjunction with other energy efficiency public awareness efforts.

Sec. 205: Tree Planting Programs

This section would authorize DOE to provide financial and technical assistance for tree planting programs that are operated by retail electric power utilities in partnership with non-profit organizations. If no qualified non-profit tree-planting organization exists in a given service area, a utility may partner with one of a number of public or private entities. To be eligible, the program must optimize the electricity-consumption reduction benefit of the trees by planting them in strategic locations around a residence or small office. The federal share of a given tree-planting project cannot be more than 50 percent; the federal contribution can be matched by any governmental or non-governmental entity. There are authorized to be appropriated such sums as may be necessary for the implementation of this section.

Sec. 207:  Community Building Code Administration Grant

This section establishes a Grant Program sponsored by the Secretary of Housing and Urban Development (HUD) to support local building code enforcement departments in enforcing building, electrical, energy, fire, fuel gas, mechanical, and plumbing codes. Grants would be awarded based on: a) the financial need of each building code enforcement department, b) benefits of the jurisdiction having an adequately funded building code enforcement department, c) demonstrated ability of each building code enforcement department to work cooperatively with other local code enforcement offices, health departments, and local prosecutorial agencies. $20 million would be appropriated for each of fiscal years 2010 to 2014 for this Grant Program.

Subtitle B: Lighting & Appliance Energy Efficiency Programs

Sec. 211: Lighting Efficiency Standards

This section creates gradually increasing efficiency standards for outdoor luminaires, requiring them to have an initial luminaire efficacy of 50 lumens per watt by 2011, 70 lumens per watt by 2013, and 80 lumens per watt by 2015. It also requires that, by 2012, all new outdoor lamps that have an output of more than 2600 lumens have a light efficiency of at least 45 lumens per watt. The section updates standards for all new portable light fixtures to require that, by 2012, they either are LED fixtures or meet Energy Star requirements, and they are not compatible with incandescent light bulbs. It requires the Department of Energy to review these portable lighting standards for feasibility, and to determine whether a separate compliance is necessary for halogen fixtures. The section also exempts from federal preemption standards on portable light fixture that are adopted by the California Energy Commission in or before 2014.

Additionally, the section prohibits GU-24 base lamps from being incandescent, and requires DOE to establish standards for incandescent reflector lamps.

Sec. 212: Other Appliance Efficiency Standards

This section establishes energy efficiency standards for water dispensers, hot food holding cabinets, and portable electric spas, gas- and oil-fired commercial warm air furnaces.

Sec. 213: Appliance Efficiency Determinations and Procedures

This section amends the definition of an “energy conservation standard” to allow DOE to set more than one energy/water efficiency or energy/water consumption standard for a given covered product, but prohibits DOE from setting a standard for any component of a covered product without specific authorization.

This section amends DOE’s rule-making procedures concerning recommendations from interested parties on testing procedures related to the energy conservation of covered products.

This section repeals the existing Uniform Test Method for Measuring the Energy Consumption of Television Sets, and requires DOE to prescribe a new test method for televisions within one year.
This section requires DOE to consider when developing new energy conservation standards for a given covered product the effect that the standards will have on carbon emissions, the estimated impact of the standard on average consumer energy prices, the increased energy efficiency that could be achieved by the product by adding smart grid capabilities to it, and the existence of a more energy-efficient example or prototype of a given product either in the United States or elsewhere.

This section requires the manufacturers of products covered by one or more energy conservation standard to submit annual reports to DOE regarding their compliance with the standards, their product sales (organized by energy efficiency, energy consumption, and/or water use), the economic impact of any proposed energy conservation standard, and other information.

This section requires DOE to add information on the estimated total annual carbon output of various appliances to the “Energyguide” labels that those products carry. The labels must account for carbon emissions based on an appliance’s energy consumption at the point of end use, the national average energy consumed or lost at all stages between energy production and distribution, and any direct emissions from the appliance.

This section amends certain requirements that state and local building codes must meet in order to prevent their own energy conservation standards for covered products from being superseded by federal standards. It also states that, in cases wherein a building code calls for a higher standard for a given product than is set by the DOE, that standard will not apply to state and local building codes unless DOE specifically issues a waiver for that standard.

Sec. 214: Best-in-Class Appliances Deployment Program

• Provides retailers or distributors with bonus payments for in accordance with the volume of their sales of high-efficiency, best-in-class equipment, electronics, and appliances. DOE would be directed to establish a standard for these high-efficiency products that would include no more than the most-efficient 10 percent of commercially available models in each class. The per-product bonus value would vary depending on a given product’s calculated energy savings, and would be determined by DOE.
• Provides premium awards to manufacturers for developing and producing super-efficient best-in-class products that are in at least the most-efficient 10 percent of best-in-class models, as determined by DOE. DOE can choose to set the standard for a Superefficient Best-in-Class Product at a level that no commercially available model meets, if it concludes that a mass-producible product could be made to meet that standard. The per-product premium award value would be determined by DOE and would be in addition to the best-in-class bonus payment that the manufacturer would receive.

This section would require DOE to consider potential energy savings from smart grid when setting standards for the Superefficient Best-in-Class products.

This section lists several products for which DOE would be required to offer premium awards, sets forth the standards that those products would be required to meet, and sets forth the value of the award for which those products would be eligible. In some cases the standards set by the legislation would include smart grid capability.

• Provides bounties for the replacement and recycling of old, inefficient appliances. If consumers surrender their used, inefficient equipment, electronics and appliances to a retailer or manufacturer at the same time as they purchase their new, best-in-class or superefficient best-in-class products, the retailer or manufacturer would receive a rebate for destroying/recycling the old products. The per-product bounty value would be determined by the estimated annual energy savings of the new product over the old product, multiplied by the estimated erstwhile remaining life of the old product (in years).

This section would authorize to be appropriated $600 million per year for the years 2011-2013 for the implementation of this program.

Sec. 215: WaterSense

This section establishes the WaterSense program within EPA to identify and promote water efficient products, buildings and landscapes, and services in order to reduce water use, reduce the strain on water, wastewater, and stormwater infrastructure, to conserve energy used to pump, heat, transport, and treat water, and to preserve water resources for future generations. This program would be modeled after the EPA and DOE's Energy Star label.

Sec. 218: Certified Stoves Program

The EPA is directed by this section to establish a program to facilitate the replacement of wood or pellet stoves that do not meet federal performance standards, or are exempt from such standards but fall within the same efficiency levels, and to require that all wood or pellet stoves sold in the US meet such standards. 25% of the authorized-to-be-appropriated funds would be directed to Indian tribes and three percent to Alaskan Native entities.

Funds provided by this legislation could not be used for the purposes of mandated emissions reductions from local, state, or federal law. Entities may conduct wood stove replacement programs as part of a settlement of an 'alleged violation of environmental law' provided the entity certifies that they would have conducted a different, yet comparable, project were the EPA precluded from accepting wood or pellet stove replacement as part of such a settlement.

Sec. 219: Energy Star Standards

This section would require the EPA to review every three years the Energy Star standards for the ten products in each product category that consume the most energy, and to update the standards as necessary. It would also require the EPA to periodically test Energy-Star-labeled products from the market to ensure that they meet Energy Star criteria, and would require the EPA to consider products that are in near-term development when establishing Energy Star categories, specifications, and criteria.

This section would direct the EPA and DOE to establish a rating system for Energy Star products to communicate to consumers the relative energy efficiency of the products with the Energy Starlabel. However, if the EPA and DOE agree that such a system would diminish the value of the Energy Star brand to consumers, they will not have to establish such a system.
$5 million per year, from FY 2010 onward, is authorized to be appropriated for this section.

Subtitle C: Transportation Efficiency

Sec. 221: Emissions Standards

This section requires EPA to create greenhouse gas emission standards by 2011 for heavy duty vehicles and engines – in the categories of automobiles, marine vessels, and locomotives– that ensure the greatest achievable emissions reductions. It also allows EPA to establish trading rules of greenhouse gas emission credits among and between these categories. It specifies that these standards should apply to vehicles and engines for at least 3 model years, and should not take effect for at least 4 model years after they are promulgated.
This section also requires the EPA to examine the various classes and categories of non-road vehicles and engines to determine those classes and categories that both contribute significantly to the emission of greenhouse gases and have the potential for significant cost-effective improvement.

Sec. 222: Greenhouse Gas Emissions Reductions through Transportation Efficiency

This section would require the EPA, in consultation with the Department of Transportation (DOT), to establish within 18 months national goals for the reduction of greenhouse gas (GHG) emissions from the transportation sector. The goals should be commensurate with the emissions reduction goals set by the rest of this bill. It would also require the EPA and DOT to assess progress toward the goals at least every six years, and to examine the contributions to emissions reductions of various measures. It would also require EPA and DOT to develop standardized models and methodologies for use in developing these reduction targets.

This section would also require each state, and each metropolitan planning organization that serves a transportation management area, to establish its own emissions reduction targets and strategies within one year of the establishment of EPA’s and DOT’s goals. It would require that the targets and strategies, at a minimum: be based on models and methodologies that this section would require EPA and DOT to establish;  contribute to the achievement of the national goals for reduction in GHG emissions from the transportation sector; and include efforts to increase public transit ridership, walking, bicycling, and other forms of non-motorized transportation. It would also require the DOT to establish performance measures and other requirements to ensure that the states’ and MPOs’ transportation plans meet the requirements of this section.

If a state or an MPO fails to develop, submit or publish its targets and strategies, the DOT would not certify that the state or MPO had met the requirements of this section (this provision is labeled “Enforcement”).

Sec. 223: SmartWay Transportation Efficiency Program

This section also amends the Clean Air Act by adding the SmartWay Transportation Efficiency Program that requires EPA to develop measurement protocols to quantify and evaluate the energy consumption and greenhouse gas impacts from technologies and strategies in the mobile source sector, including freight carriers. In addition, EPA must demonstrate and promote the benefits of technologies, products, fuels and operational strategies that reduce energy consumption and emissions through this program. The program would also establish a financing program to award loans and leases to public and private entities (States, tribes, local governments, regional organizations, non-profit organizations, and for profit companies) for the adoption of low-greenhouse gas technologies and strategies in the mobile source sector. There are authorized to be appropriated such sums as may be necessary to carry out this section.

Sec. 224: State Vehicle Fleets

This section amends Section 507(o) of the Energy Policy Act of 1992 by allowing DOE to revise the rules for state vehicle fleet with respect to the types of alternative fuel vehicles so that they are in compliance with any updates to the alternative fuel vehicles allowed for the minimum federal fleet efficiency requirements.

Subtitle D: Industrial Energy Efficiency Programs

Sec. 241: Industrial Plant Energy Efficiency Standards

This section directs the DOE to work with the American National Standards Institute on the development of and participation in a certification program for industrial plant energy efficiency. Such sums as may be necessary are authorized to be appropriated for this program.

Sec. 242: Electric and Thermal Energy Efficiency Award Programs

This section directs the DOE to establish an awards program for the innovative waste heat recovery for electricity production or thermal use. The awards are available for the owners and operators of new and existing electricity and thermal generation facilities using fossil or nuclear fuel. The awards can be as much as 25% of the value of energy projected to be recovered through the first five years of program activity or the amount necessary to make the project economically viable, as established by the DOE. The DOE must work with the state regulatory agencies to aid electricity providers in the sale of thermal byproducts. Such sums as may be necessary are authorized to be appropriated for this program.

Sec. 244: Motor Market Assessment and Commercial Awareness Program

This section requires DOE to conduct a study of electric motors and the electric motor market in the United States that include important subsectors of the industrial and commercial electric motor market including the stock of motors and motor-driven equipment, efficiency categories of the motor population, and motor systems that use drives, servos and other control technologies. DOE then must estimate the opportunities for improvement in the energy efficiency of motor systems by market segment and provide recommendations to update motor profile and methods to estimate the energy savings and market penetration attributable to the Save Energy Now Program. Based on these findings, DOE is to establish a national program targeted at motor end-users in increase the awareness of energy and cost-saving opportunities in the commercial and industrial facilities using higher efficiency motors, improvements in motor system procurement, and criteria for making decisions for new, replacement, or repair motor and motor system components.

Sec. 245: Motor Efficiency Rebate Program

This section establishes a program to provide rebates for the purchase and installation of a new electric motor that has a nominal full load efficiency that is not less than the nominal full load efficiency of table 12-12 of NEMA Standards Publication MG 1-2006 for random wound motors rated 600 volts or lower or table 12-13 for form wound motors rated 5,000 volts or lower and to replace an installed motor to meet the specifications established by the Department of Energy. The rebate granted would be determined by formula that is equal to the product obtained by multiplying the nameplate horsepower of the electric motor purchased and $25.00. This program is authorized at $80 million for 2011, and reduced by $5 million in each subsequent year through 2015.

Subtitle E: Improvements in Energy Savings Performance Contracting

Sec. 251: Energy Savings Performance Contracts

This section amends competition requirements for Energy Savings Performance Contracting of federal buildings to foster a competitive application process. The new process would require a Federal agency that wishes to issue a task or delivery order under an ESPC to notify all previously awarded contractors that the agency will solicit an expression of interest for ESPC services. The agency must review the expressions of interest and select two or more contractors whose qualifications and records of performance it will review further. From among those chosen for further review, the agency may select one or more contractors to conduct site surveys and studies in order to submit a price proposal of services. After reviewing and choosing contractors, agencies can further negotiate a task or delivery order for contracting services based on the energy conservation measures identified, and may subsequently issue the order for contracting services to that contractor or contractors.

Subtitle F: Public Institutions

Sec. 261: Public Institutions

This section amends the Energy Policy and Conservation Act of 1975 to designate nonprofit hospitals and public health facilities as eligible public institutions for energy efficiency grants and loans. It also increases the maximum per-project grant amount for certain grants made to improve energy efficiency and sustainability in public institutions.

Sec. 262: Community Energy Efficiency Flexibility

This section amends the Energy Efficiency and Conservation Block Grant Program to remove certain restrictions on the eligible use of funds by local governments and Indian tribes.

Section 263: Small Community and Joint Participation

This section amends the Energy Efficiency and Conservation Block Grant Program to allow adjacent, contiguous, and geographically small communities to join together to meet the eligible unit of local government requirement for participation.

Sec. 264: Low-Income Community Energy Efficiency Program

This section establishes a program, to be run by DOE, that would provide grants to private, non-profit, mission-driven, community development organizations to provide financing to businesses and projects that improve energy efficiency, identify and develop alternative, renewable, and distributed energy supplies, promote job and business opportunities for low-income residents, and increase energy conservation in low-income rural and urban communities. This program is authorized at $50 million per year for five years.

Sec. 265: Consumer Behavior Research

This section establishes a research program to identify factors affecting consumer actions to conserve energy and make improvements in energy efficiency. Through this program, the Secretary of Energy would provide grants to public and private institutions of higher education to study the effects of consumer behavior on total energy use and identify potential energy savings from changes in consumer consumption habits. Grants would also support the development of strategies that communicate the importance of energy efficiency and conservation to consumers, and increase public awareness of federal climate adaptation and mitigation programs, as well as effects of energy consumption habits.

Subtitle G: Miscellaneous

Sec. 271: Energy Efficient Information and Communication Technologies

Each federal agency, in collaboration with OMB, must create an implementation strategy for the purchase and use of energy efficient information and communications technologies and practices within agency facilities. Strategies must be cost-effective, based on stakeholder input, and where possible, include existing best practices. Agencies can consider, among other things, to incorporate advanced metering infrastructure, efficient data centers, building systems efficiency, and telework. Their efforts to be more energy efficient through these technologies will be evaluated by performance goals established by OMB , including a measurement of costs over 3-5 year period.

Sec. 272: National Energy Efficiency Goals

This section directs DOE, EPA and appropriate Federal agencies to develop a strategic plan to increase the energy productivity of the United State by 2.5 percent each year from 2012 to 2030. Energy productivity is to be measured in GDP per unit of energy input. The plan must identify regulatory, funding and policy priorities that would assist the United States in meeting the national goal and establish sector by sector data collection methodologies to establish baseline energy use and savings.

Sec. 273: Affiliated Island Energy Independence Team

This section requires DOE to assemble a team to address the energy needs of affiliated islands, as defined in the section, to improve their energy infrastructure through projects that improve the energy efficiency of their power generation, transmission, and distribution and increase consumer energy efficiency, among other schemes.

Sec. 274: Product Carbon Disclosure Program

This section would require the EPA to study the feasibility of a national program that would measure, label, publicly disclose and add to product labels the carbon content of products and materials sold in the United States. It would also require the EPA to establish, within 36 months of the enactment of the Act, a voluntary national program for the disclosure of products' carbon content. The EPA would include incentives for program participation, provide for a public outreach campaign to increase consumer awareness, and develop protocols for measuring and verifying a product's carbon content.

This section defines "carbon content" as "the amount of greenhouse gas emissions and their warming impact on the atmosphere expressed in carbon dioxide equivalent associated with a product's value chain."

This section authorizes $5 million for the EPA study and $25 million per year from 2010 to 2025 for EPA to implement the Product Carbon Disclosure Program.

Sec. 275: Industrial Energy Efficiency Education and Training Initiative

This section would require the DOE to carry out a national awareness program to educate government leaders and leaders in the industrial and commercial buildings sectors on the large energy-saving potential of greater use of mechanical insulation and other measures. It would provide information through education and training sessions, web-based information and advertising. This section would authorize to be appropriated $3.5 million per year from FY 2010 to FY 2014.

Subtitle H – Green Resources for Energy Efficient Neighborhoods

Sec. 281 – 308: The GREEN Act

The GREEN Act would encourage the use of energy efficiency mortgages which would assist homeowners to finance efficiency improvements to homes they purchase. It would set out greater incentives for efficiency in FHA-financed buildings as well as increasing the standards for single and multifamily structures to receive such incentives. HUD would establish demonstration projects to showcase the effectiveness of efficiency in reducing the costs of homeownership and low income communities would be supported in taking advantage of energy efficient mortgages. A grant program for single and multifamily housing would also be created, based on the model of the community development block grant program.